More gas stations turn off taps in bid to survive

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More gas stations turn off taps in bid to survive

The number of temporarily closed gas stations touched a fresh monthly high in August amid a prolonged economic downturn, a trade association said yesterday.

The Korea Oil Stand Association (KOSA) said the number was tallied at 436 in August, or a daily average of 14.
The number of temporarily closed gas stations hovered at a monthly average of 200 in the 2000s, but rose sharply to more than 300 in 2011 when the market became saturated.

In the first eight months, the number of the closed stations reached a monthly average of 417, up 11.7 percent from 373 the same period last year.

Market watchers blamed the sharp rise on cash-strapped owners hurt by the prolonged economic downturn.

“It costs an estimated 150 million won ($135,440) to permanently shut down a gas station, so the owners, who are facing cash shortages, are seeking instead to just suspend operations temporarily,” said an official at the KOSA.

Market watchers forecast the number of closed gas pumps will increase over the next few years. As of August, the number of gas stations operating in Korea hit 12,830, 22 less than in the previous month, and a drop of 76 from January.

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